LAHORE - The profit of textile companies have grown to Rs 8.9 billion in third quarter of fiscal year 2012-13, depicting growth of 7 per cent quarterly and 180 per cent annually. Cumulatively, textile profits have reached Rs 23 billion in 9MFY13 versus Rs 4.5 billion in the same period last year.

According to industry, the upward trajectory of profits is also because of cheaper financing and continuous Pak rupee depreciation in addition to firm cotton prices and strong regional demand. With the continuation of these factors, experts believe textile profits will remain strong in coming month. Further, expected GSP Plus status for Pakistan by EU will further push Pakistan’s textile to European countries.

They said that contrary to sharp decline of 9 per cent in FY12 to $12.4 billion, higher regional demand and firm textile prices culminated into 6.1 per cent growth in exports to $10.7 billion. In Rupee terms, the exports posted a rise of 15.5 per cent to Rs 1.0 trillion.

However, within textile, yarn exports have increased by 26 per cent to $1.85 billion in FY13. Similarly, grey cloth and ready-made garments exports surged by 11 per cent and 12 per cent to $2.2 billion and $1.5 billion, respectively.

They said that with fortunes favouring Pakistan’s largest textile sector, profits of listed textile units have increased by 7 per cent QoQ to Rs 8.9b in 3QFY13. This is in addition to 52 per cent profitability growth witnessed in 2QFY13. In line with the profits, textile exports has also showed 15.5 per cent ($6.1 per cent) improvement to Rs 1 trillion ($10.7b) in 10MFY13. Improved profitability and exports are mainly because of strong demand from China and neighbors, firm international cotton prices, cheaper financing and continuous Pak rupee depreciation.